Corporate Structure and Compliance - The company is classified as a large accelerated filer under the Securities Exchange Act[4]. - The financial statements are prepared in accordance with U.S. Generally Accepted Accounting Principles (GAAP)[5]. - The company has not reported any securities under Section 12(g) of the Exchange Act[2]. - There are no outstanding securities that require reporting under Section 15(d) of the Exchange Act[2]. - The company has submitted all required reports under the Exchange Act in the past 12 months[4]. - The company has not indicated any errors in previously issued financial statements that would require restatement[5]. - The company has not been classified as a shell company under the Exchange Act[6]. - The company has established a series of contractual agreements to effectively control variable interest entities (VIEs) in China, including shareholder voting rights, equity pledge agreements, and loan agreements[17]. - The company relies on contractual arrangements with VIEs and their shareholders for all business operations, which may not be as effective as direct ownership[18]. - The company may incur substantial costs in enforcing the terms of the contractual arrangements with VIEs, which are governed by Chinese law[17]. - The company is subject to significant oversight and discretion from the Chinese government, which could adversely affect its operations and the value of its American depositary shares[69]. - The company has been recognized as a committee-designated issuer under the HFCAA, which may lead to trading prohibitions if it continues to use an accounting firm located in jurisdictions that PCAOB cannot inspect[21]. - The PCAOB has not been able to fully inspect or investigate registered accounting firms based in mainland China and Hong Kong, which poses a risk to the company's compliance with the HFCAA[21]. - The company has not received any notifications regarding its status as a "critical information infrastructure operator" under Chinese law, creating uncertainty about additional obligations[110]. Financial Performance - The total net income for 2023 was RMB 16,290,027 thousand, a slight decrease from RMB 16,553,930 thousand in 2022[37]. - Operating costs and expenses totaled RMB 11,433,063 thousand in 2023, compared to RMB 12,081,746 thousand in 2022, indicating a reduction in operational expenditures[37]. - The company reported a net operating income of RMB 4,856,964 thousand in 2023, compared to RMB 4,472,184 thousand in 2022, reflecting growth in operational performance[37]. - Net profit for 2023 reached RMB 4,268,577, a 6.6% increase from RMB 4,005,568 in 2022[38]. - Basic earnings per share for 2023 was RMB 13.36, up from RMB 12.87 in 2022, reflecting a 3.8% growth[38]. - The company’s total equity reached RMB 22,009,857 in 2023, up from RMB 18,931,297 in 2022, marking a 10.8% increase[41]. - The company reported a total liability of RMB 27,597,272 thousand, leading to total equity of RMB 19,791,799 thousand[53]. - The company’s net profit attributable to ordinary shareholders was RMB 1,077,675 thousand, reflecting a significant increase compared to previous periods[50]. - The company’s total assets reached RMB 45,818,572, an increase of 13.5% from RMB 40,343,170 in 2022[41]. - The company’s cash flow from investing activities for 2023 was a net outflow of RMB 11,147,789, compared to a net outflow of RMB 7,355,975 in 2022[43]. Market Operations and Strategy - The company operates primarily in the People's Republic of China, with significant implications for its business operations[8]. - The company aims to strengthen relationships with borrowers, financial institution partners, and data partners[11]. - The company has a significant focus on expanding its market presence and exploring potential mergers and acquisitions[11]. - The company expects growth in the Chinese credit technology industry and anticipates increased demand for its credit technology products[11]. - The company is focused on enhancing its technology and credit assessment capabilities to manage credit risk effectively and improve service offerings[74]. - The company plans to declare and distribute regular cash dividends starting from the first half of 2023, amounting to approximately 20% to 30% of the after-tax net profit for the preceding six-month period[34]. - The company has plans for market expansion and new product development, aiming to enhance its competitive position in the industry[50]. Regulatory Environment and Risks - The company faces various risks related to conducting business in China, including compliance with complex and evolving regulations, which could adversely affect its operations and the value of its American Depositary Shares (ADS)[20]. - There is significant uncertainty regarding the interpretation and enforcement of VIE contractual arrangements under current and future Chinese laws, which may impact the company's operational control[19]. - If the company or any VIE is found to violate existing or future Chinese laws or regulations, it may face severe penalties or be forced to relinquish its interests in those businesses[19]. - The Chinese government has significant power to regulate the company's operations and foreign investment, which could severely limit its ability to issue or continue issuing securities[22]. - The uncertainty surrounding the Chinese legal system and its rapid regulatory changes may lead to significant adverse impacts on the company's operations and the value of its ADS[22]. - The company faces significant risks related to regulatory uncertainties in the credit technology industry, which could adversely affect its financial condition and operational performance[65]. - The company is subject to ongoing regulatory scrutiny regarding its microfinance and financing guarantee practices, which could adversely affect its financial condition and operational performance[86]. - The company may face significant negative impacts if regulatory authorities deem its rectification efforts insufficient or unsatisfactory[81]. - The company is subject to the new financing guarantee regulations, which restrict unapproved entities from providing guarantee services, affecting its operational strategies[78]. Credit and Loan Management - The variable interest entities' revenue accounted for 94% of the total net revenue in 2023, up from 92% in both 2021 and 2022[16]. - The company reported a 180-day+ historical overdue rate, which is a percentage of loans overdue for more than 180 days, calculated based on the total principal amount of loans facilitated during a fiscal quarter[10]. - The company reported a recovery rate of overdue principal amounts within 30 days, calculated as a percentage of the total overdue principal[10]. - The company aims to maintain a low overdue rate for loans facilitated through its platform while expanding its borrower base and improving product utilization[72]. - The company relies on proprietary credit analysis models to assess borrower creditworthiness, and any flaws in these models could severely impact its reputation and market share[66]. - The company has implemented comprehensive collection policies and procedures to ensure compliance with current laws and regulations[154]. - The company relies on various collection methods for overdue loans, and any failure in these methods could lead to a decline in recovery rates[150]. Technology and Data Security - The company utilizes a light capital model, which involves technology-enabled services throughout the loan lifecycle without assuming credit risk[10]. - The deployment of AI-enabled tools, such as the Argus engine, is essential for accurate credit scoring and risk modeling, with potential inaccuracies impacting partnerships with financial institutions[146]. - The company faces inherent risks in protecting user privacy and complying with evolving regulatory frameworks regarding personal data collection and security[106]. - The company has taken measures to protect personal information but still faces challenges related to data security and compliance with applicable laws[106]. - The company is closely monitoring regulatory requirements and seeking guidance from regulatory authorities to ensure compliance with applicable laws and regulations[90]. Financial Partnerships and Funding - The company has established trust arrangements with financial institution partners for loan facilitation, which may impact its financial condition if expected returns are not met[175]. - The company relies on partnerships with several trust companies and asset management firms to secure funding through trust and asset management plans[131]. - The company’s largest financial institution partner, Jincheng Bank, is crucial for exploring innovative collaborations, with potential risks if its business or reputation deteriorates[130]. - The company cannot guarantee sustainable funding from financial institution partners, which may impact reputation, operational performance, and financial condition[125]. - The company may lose funding sources if it fails to effectively match regional banks with local borrowers, which could significantly impact operational performance and profitability[127]. Human Resources and Management - The company’s ability to attract and retain talented employees is crucial for supporting business growth and operational efficiency[73]. - The company may face significant challenges in retaining key management personnel, which could disrupt operations and negatively impact financial performance[177]. - The company’s operations depend heavily on the continued service of its management team, particularly in risk management and product development[177]. Legal and Compliance Issues - The company faces potential negative impacts on its reputation and business performance due to improper actions by third-party collection service providers[154]. - The company may incur substantial costs and resource expenditures to comply with the Sarbanes-Oxley Act, which could affect its financial performance[180]. - The company is unable to ensure that it can renew contracts with service providers on favorable terms, which may affect its operational capabilities[158]. - The company has not tested its disaster recovery plan under actual disaster conditions, which may hinder its ability to recover data and services during interruptions[166]. Economic and Market Conditions - The overall scale may be affected by various factors, including brand awareness, market interest rates, and macroeconomic conditions, which could negatively impact loan matching growth and revenue[120]. - The company’s revenue from loan products may decline due to reduced discretionary spending among consumers and small businesses amid economic downturns[191]. - The competitive landscape in China's credit technology industry is intensifying, with competitors potentially having more financial, technical, and marketing resources, which could adversely affect the company's business performance and financial condition[147]. - The average wage in China is expected to continue rising, impacting labor costs and potentially affecting the company's financial performance unless costs can be controlled or passed on to users[184]. Environmental, Social, and Governance (ESG) Considerations - The company is increasingly sensitive to ESG issues due to heightened attention from the Chinese government and investors, which may impact financing and compliance costs[190]. - The company may face additional costs and risks related to environmental, social, and governance matters, which could adversely affect its business and financial performance[189]. - The company’s ability to adapt to changing ESG expectations is critical to avoid reputational damage and potential financial losses[190].

SHANGHAI, China, April 26, 2024 (GLOBE NEWSWIRE) -- Qifu Technology, Inc. (NASDAQ:QFIN, HKEx: 3660))) ("Qifu Technology" or the "Company"), a leading Credit-Tech platform in China, today announced that it has filed its annual report on Form 20-F for the fiscal year ended December 31, 2023 with the U.S. Securities and Exchange Commission on April 26, 2024. The annual report can be accessed on the Company's investor relations website at ir.qifu.tech as well as the SEC's website at www.sec.gov. The Company wil ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 20-F (Mark One) ☐ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2023. OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☐ SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITI ...

Investors interested in Business Services stocks should always be looking to find the best-performing companies in the group. Qifu Technology, Inc. (QFIN) is a stock that can certainly grab the attention of many investors, but do its recent returns compare favorably to the sector as a whole? A quick glance at the company's year-to-date performance in comparison to the rest of the Business Services sector should help us answer this question.Qifu Technology, Inc. is a member of the Business Services sector. T ...

Core Viewpoint - Qifu Technology, Inc. has announced significant updates regarding its share repurchase plans, including the completion of a previous plan and the initiation of a new, larger repurchase program [1][2]. Share Repurchase Plans - The 2023 Share Repurchase Plan authorized the company to repurchase up to US$150 million worth of its American depositary shares (ADSs) or Class A ordinary shares over a 12-month period starting June 20, 2023. As of March 28, 2024, the company had repurchased 9,348,543 ADSs for a total of US$149,979,804, averaging US$16.02 per ADS [1]. - The newly approved 2024 Share Repurchase Plan allows the company to repurchase up to US$350 million worth of its ADSs or Class A ordinary shares over the next 12 months starting April 1, 2024. The repurchases will be conducted based on market conditions and in compliance with applicable regulations [2]. Company Overview - Qifu Technology is a leading Credit-Tech platform in China, providing a comprehensive suite of technology services to assist financial institutions, consumers, and SMEs throughout the loan lifecycle, including borrower acquisition, credit assessment, fund matching, and post-facilitation services [3].

When it comes to short-term investing or trading, they say "the trend is your friend." And there's no denying that this is the most profitable strategy. But making sure of the sustainability of a trend to profit from it is easier said than done.The trend often reverses before exiting the trade, leading to a short-term capital loss for investors. So, for a profitable trade, one should confirm factors such as sound fundamentals, positive earnings estimate revisions, etc. that could keep the momentum in the st ...

Investment Rating - The report maintains a "Buy" rating for QFIN US with a target price of $23.00, indicating a potential upside of 24.5% from the current price of $18.47 [1][9]. Core Insights - The company is focusing more on growth quality and shareholder returns in 2024, with a net profit of 4.285 billion RMB in 2023, reflecting a year-on-year increase of 6.5% [1]. - The loan facilitation amount for 2023 grew by 15.4% year-on-year, aligning with the company's guidance, while the annualized net take rate for Q4 was 3.2%, up 0.4 percentage points year-on-year [1]. - The proportion of light assets has increased and is expected to continue rising in 2024 due to risk management considerations [1]. - Asset quality remains under pressure, with a 90-day delinquency rate of 2.35% in Q4, but there are signs of improvement since December [1]. - The company has tightened credit standards and is leveraging AI technology to reduce customer acquisition costs and enhance operational efficiency [1]. Financial Performance Summary - For 2023, the company reported a net profit of 4.285 billion RMB, with a projected net profit for Q1 2024 of 11.5-12.0 billion RMB, representing a year-on-year growth of 17-22% [1][2]. - Revenue for 2023 was 16.290 billion RMB, with a slight decline of 1.6% year-on-year, but expected to grow by 7.1% in 2024 [4][6]. - The forecast for net profit in 2024 is 4.631 billion RMB, with a year-on-year growth of 8.1% [4][6]. - The company plans to repurchase $350 million worth of shares over the next 12 months, with dividends and buybacks expected to exceed 70% of net profit in 2024 [2]. Key Financial Metrics - The company’s return on equity (ROE) is projected to remain above 20% over the next three years [2]. - The price-to-book ratio for 2024 is estimated at 1.2 times [2]. - The dividend yield is expected to be around 5.5% for 2023, increasing to 7.1% in 2024 [4][6].

Qifu Technology, Inc. (NASDAQ:QFIN) Q4 2023 Earnings Conference Call March 12, 2024 8:30 PM ET Company Participants Karen Ji - Senior Director of Capital Markets Wu Haisheng - CEO Alex Xu - CFO Yan Zheng - Chief Risk Officer Conference Call Participants Richard Xu - Morgan Stanley Alex Ye - UBS Emma Xu - Bank of America Securities Yada Li - CICC Operator Ladies and gentlemen, thank you for standing by, and welcome to the Qifu Technology Fourth Quarter and Full Year 2023 Earnings Conference Call. [Operator I ...

Financial Performance - The net profit for 2023 was RMB 4.3 billion, with a non-GAAP net profit of RMB 4.5 billion[4]. - The net income for 2023 was RMB 4,495.5 million (USD 633.2 million), compared to RMB 3,906.6 million in the same period of 2022[14]. - The fourth quarter net income totaled RMB 4.5 billion, with non-GAAP net profit reaching RMB 1.15 billion[15]. - The net income for the fourth quarter was RMB 4,495.5 million, compared to RMB 3,906.6 million in the same period of 2022[16]. - The net profit for the fiscal year 2023 was RMB 4,268,577 thousand, representing a 6.6% increase compared to RMB 4,005,568 thousand in 2022[58]. - The non-GAAP net profit for the fiscal year was RMB 4,454,181, representing a 5.9% increase from RMB 4,205,305 year-over-year[62]. - The company reported a net profit margin of 26.2%, with a non-GAAP net profit margin of 27.3%[28]. - The company’s diluted earnings per American Depositary Share (ADS) were RMB 6.88 (USD 0.96) for the period[22]. - The diluted earnings per ADS for the fiscal year ended December 31, 2023, was $3.68, compared to $3.50 for the previous year, indicating a 5.1% increase[62]. Revenue and Income Growth - The total loan facilitation and initiation scale reached RMB 475.8 billion, a year-on-year increase of approximately 15.4%[14]. - The financing income for the fourth quarter was RMB 1,485.4 million, an increase from RMB 1,002.1 million in the same period of 2022[16]. - The company reported a total financing income of RMB 5,109,921 thousand for the fiscal year 2023, a significant increase of 46.5% from RMB 3,487,951 thousand in 2022[52]. - The gross margin for the fiscal year 2023 improved to 29.8%, compared to 24.5% in 2022[52]. - The operating profit for the fiscal year ended December 31, 2023, was RMB 4,856,964, a 8.6% increase from RMB 4,472,184 in 2022[62]. Operating Metrics - The operating profit margin for 2023 was 28.5%, while the non-GAAP operating profit margin was 29.4%[14]. - The operating cash flow in the fourth quarter reached approximately RMB 2.35 billion, setting a historical high[15]. - The operating cash flow for Q4 2023 was RMB 2,351,791 thousand, up 31.2% from RMB 1,792,477 thousand in Q4 2022[54]. - The operating profit margin under GAAP for the three months ended December 31, 2023, improved to 28.5% from 24.2% in the same period of 2022[60]. - The non-GAAP operating profit margin for the same period increased to 29.4%, up from 25.5% year-over-year[60]. - The non-GAAP operating profit margin for the fiscal year improved to 31.0%, compared to 28.2% in the previous year[62]. User and Loan Metrics - As of December 31, 2023, the platform connected with 157 financial institution partners and 235.4 million potential credit demand consumers, a 12.8% increase from the previous year[6]. - The number of users with approved credit limits reached 50.9 million, up 14.4% from 44.5 million a year earlier[6]. - The total loan facilitation scale in Q4 2023 was RMB 119.0 billion, a 13.8% increase from RMB 104.6 billion in Q4 2022[6]. - The loan balance under light capital model and other technology solutions reached RMB 114.5 billion, an 18.6% increase from RMB 96.6 billion a year earlier[6]. - The 90+ days overdue rate for loans was 2.35% as of December 31, 2023[6]. Shareholder Returns - The cash dividend for 2023 is expected to be USD 170 million, with a total value of USD 132 million in share repurchases since June 2023[4]. - A new share repurchase plan of USD 350 million was announced, reaffirming the existing semi-annual dividend policy[4]. - The company plans to distribute a semi-annual dividend of USD 0.29 per A-class ordinary share or USD 0.58 per American Depositary Share, with a total dividend distribution of approximately USD 170 million for the fiscal year 2023[33]. - The company has approved a new share repurchase plan worth up to USD 350 million, effective from April 1, 2024, for a period of 12 months[36]. Cost and Expense Management - Total operating costs and expenses were RMB 3,215.9 million (USD 453.0 million), up from RMB 2,962.7 million in the same period last year[18]. - The company reported a decrease in sales and marketing expenses to RMB 1,939.9 million (USD 273.2 million) from RMB 2,206.9 million in 2022, attributed to improved marketing efficiency[27]. - The company’s total operating expenses for the fiscal year 2023 were RMB 11,433,063 thousand, a decrease of 5.4% from RMB 12,081,746 thousand in 2022[52]. Balance Sheet Highlights - Total assets increased from RMB 40,343,170 thousand to RMB 45,818,572 thousand, representing a growth of approximately 11.5% year-over-year[50]. - Total liabilities rose from RMB 21,411,873 thousand to RMB 23,808,715 thousand, an increase of approximately 11.2%[50]. - Total equity increased from RMB 18,931,297 thousand to RMB 22,009,857 thousand, reflecting a growth of approximately 16.4%[50]. - Cash and cash equivalents decreased from RMB 7,165,584 thousand to RMB 4,177,890 thousand, a decline of about 41.5%[50]. - The provision for receivables was RMB 2,151.0 million (USD 303.0 million), up from RMB 1,580.3 million in 2022, due to an increase in loan origination scale[27]. Future Outlook - The company will provide forward-looking guidance during its earnings conference call scheduled for March 12, 2024[37]. - The company plans to expand its market presence through new product launches and strategic partnerships in 2024[52].

Financial Performance - The net profit for 2023 was RMB 4.3 billion, with a non-GAAP net profit of RMB 4.5 billion[4]. - The net income for 2023 was RMB 4,495.5 million (USD 633.2 million), compared to RMB 3,906.6 million in the same period of 2022[16]. - The fourth quarter net income was RMB 4.5 billion, with a non-GAAP net profit of RMB 1.15 billion, and the annual non-GAAP net profit reached RMB 4.45 billion[15]. - The annual net profit for 2023 was RMB 4,268,577 thousand, up 6.6% from RMB 4,005,568 thousand in 2022[58]. - The non-GAAP net profit for the fiscal year was RMB 4,454,181, up 5.9% from RMB 4,205,305 in the previous year[62]. - The company's net profit attributable to the company was RMB 4,285.3 million (USD 603.6 million), compared to RMB 4,024.2 million in 2022, representing a year-over-year increase of 6.5%[28]. - The company reported a net profit margin of 26.2%, with a non-GAAP net profit margin of 27.3%[28]. Revenue and Income Growth - In 2023, the total loan facilitation and initiation scale reached RMB 475.8 billion, a year-on-year increase of approximately 15.4%[14]. - The total financing income for Q4 was RMB 1,485.4 million (USD 209.2 million), an increase from RMB 1,002.1 million in the same period of 2022[16]. - Financing income for the year surged to RMB 5,109,921 thousand, a 46.6% increase from RMB 3,487,951 thousand in 2022[52]. - The company's operating income was RMB 4,857.0 million (USD 684.1 million), an increase from RMB 4,472.2 million in 2022, reflecting a year-over-year growth of 8.6%[27]. - The operating income for the fiscal year was RMB 4,856,964, representing an 8.6% increase from RMB 4,472,184 in 2022[62]. Shareholder Returns - The cash dividend for 2023 is expected to be USD 170 million, with a total value of USD 132 million in share repurchases since the plan's implementation[4]. - A new share repurchase plan of USD 350 million was announced, reaffirming the existing semi-annual dividend policy[4]. - The company plans to distribute a semi-annual dividend of USD 0.58 per American Depositary Share, with a total dividend payout of approximately USD 170 million for the fiscal year 2023[33]. - The company has initiated a share repurchase plan with a total value of up to USD 150 million, having repurchased approximately 8.4 million ADS at an average price of USD 15.7 per share[35]. Loan and Credit Metrics - The total loan facilitation scale in Q4 2023 was RMB 119.0 billion, a 13.8% increase from RMB 104.6 billion in Q4 2022[6]. - The loan balance under light capital model and other technology solutions reached RMB 114.5 billion, an 18.6% increase from RMB 96.6 billion a year earlier[6]. - The number of users with approved credit limits reached 50.9 million, up 14.4% from 44.5 million a year earlier[6]. - The 90+ days overdue rate for loans was 2.35% as of December 31, 2023[6]. - The weighted average contract term for loans initiated by financial institutions was approximately 11.47 months in Q4 2023[6]. Operating Costs and Expenses - Total operating costs and expenses were RMB 3,215.9 million (USD 453.0 million), compared to RMB 2,962.7 million in the same period last year[18]. - The total operating expenses for 2023 were RMB 11,433,063 thousand, down from RMB 12,081,746 thousand in 2022, reflecting a 5.4% reduction[52]. - The company's financing costs increased to RMB 645.4 million (USD 90.9 million) from RMB 504.4 million in 2022, primarily due to increased funding from asset-backed securities[26]. Asset and Liability Overview - Total assets increased from RMB 40,343,170 thousand to RMB 45,818,572 thousand, representing a growth of approximately 11.5% year-over-year[50]. - Total liabilities rose from RMB 21,411,873 thousand to RMB 23,808,715 thousand, an increase of approximately 11.2%[50]. - The company's total equity increased from RMB 18,931,297 thousand to RMB 22,009,857 thousand, reflecting a growth of around 16.4%[50]. - Cash and cash equivalents decreased from RMB 7,165,584 thousand to RMB 4,177,890 thousand, a decline of about 41.5%[50]. Strategic Initiatives - The company expanded its customer acquisition channels and established strong embedded financial partnerships with leading internet traffic platforms[14]. - The company plans to enhance its growth strategy and expand its market presence, focusing on new product development and technological advancements[47].